-- EMEA crude futures climbed in after-hours trading on Tuesday after President Trump ruled out extending a two-week ceasefire with Iran, stoking fears of a direct military escalation in the Middle East and renewed disruptions to global energy flows.
Brent crude futures climbed by 4.93% to $94.03 per barrel, while Murban oil futures were up 2.40% to $95.27/bbl.
ING strategists said Trump has suggested he is unlikely to extend the ceasefire, and a lack of progress would likely push oil and gas prices higher.
The two-week truce between the US and Iran is set to expire soon, and there is still no clarity on whether a second round of talks will take place. Trump reportedly warned that the US military would obliterate Iran's enriched uranium reserves.
Though a US delegation led by Vice President JD Vance is scheduled to hold talks in Islamabad, Iranian officials have signaled they may not attend. Parliament Speaker Mohammad Bagher Qalibaf wrote on X that Tehran would not negotiate "under the shadow of threats".
Meanwhile, Pakistan, which brokered the first round of talks, said there was still no confirmation that Iran would attend peace talks with Washington, after the US boarded a huge Iranian oil tanker at sea with just a day left to the ceasefire.
"Formal response from Iranian side about confirmation of delegation to attend Islamabad Peace Talks is still awaited," Pakistan's information minister, Attaullah Tarar, said in a post on X. "Pakistan as the mediator is in constant touch with Iranians and pursuing the path of diplomacy and dialogue."
The Department of War, previously the Department of Defense, said the US forces stopped and boarded a sanctioned oil tanker in its campaign to disrupt Iran's shipping network.
US forces have boarded the crude oil tanker Tifani in the Indian Ocean, in what appears to be a further escalation in enforcement against Iran-linked shipping, MarineTraffic said in a social media post on X, citing media reports.
The shipping data firm said the 330-meter VLCC was reportedly carrying about 2 million barrels of crude loaded at Kharg Island earlier in April.
Three vessels, two cargo ships and a fuel tanker, crossed the Strait of Hormuz on Tuesday as US and Iranian blockades remained in place, according to media reports.
"The limited number of vessels managing to transit has done little to ease the ongoing tightening of the global energy market, which is increasingly short of prompt supplies - supporting elevated prices across diesel, jet fuel, fertilisers, and other key commodities," Saxo Bank strategists said on Tuesday.
On the supply side, Ukrainian President Volodymyr Zelenskyy said on Tuesday that Kyiv had completed repairs to the Druzhba oil pipeline and it is ready to pump Russian oil to Europe. However, Russia is reportedly set to stop oil exports from Kazakhstan to Germany via the Druzhba pipeline starting from May 1.